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The Central Bank of the United Arab Emirates (CBUAE) announced that it has completed the world’s largest central bank digital currency pilot mBridge (CBDC) in cooperation with the Digital Currency Research Institute of the People’s Bank of China. Other partners include the Hong Kong Monetary Authority, the Bank of Thailand and the Bank for International Settlements, the agency said in a statement. statement.
“This project – the first pilot use of a wholesale CBDC in the MENA region – reflects CBUAE’s commitment to creating a world-class financial infrastructure and innovative payment systems, in line with the UAE leadership’s mandate to support the UAE’s economic competitiveness and enhance diversity and Growth of the country’s financial sector,” CBUAE said.
According to Emirates Bank, “during the pilot project, commercial banks in four jurisdictions used the mBridge platform to conduct more than 160 payment and foreign exchange transactions over a six-week period, totaling more than AED 80 million (US$ 22 million).”
The CBUAE said the initiative demonstrates faster, more cost-effective and secure cross-border currency settlements using central bank funds.
mBridge “offers an efficient, compliant and scalable cross-border payments solution with a CBDC at its core, designed to operate across different jurisdictions and currencies.”
Khaled Mohamed Balama, governor of the bank, commented that the project reflects the UAE’s determination to establish the country as one of the leaders in the development and issuance of CBDCs, and a preferred regional hub for advanced financial infrastructure.
“This project is part of the CBUAE initiative to support the competitiveness, diversity and growth of the UAE’s financial sector in line with future economic trends. We will continue to build the right governance framework for an interoperable CBDC, bringing benefits to UAE companies and consumers for real benefits,” the official said.
In November 2021, when reporting on the progress of the initiative, the bank Say Twenty-two” project participants from all four jurisdictions identified 15 possible business test cases to evaluate the ability of the mBridge trial platform to augment real-world cross-border payments. The identified business test cases transactions across the 11 sectors tested (AED 1 billion in total).”
“Among the 15 cases, five UAE-based banks were involved, including First Abu Dhabi Bank, Emirates NBD, Dubai Islamic Bank, HSBC and Standard Chartered. Given the volume of trade between the four jurisdictions Up to $731 billion, international trade settlements are prioritized in identified commercial test cases,” CBUAE said.
Notably, according to a recent report, the Middle East and North Africa (MENA) is the fastest growing market in the world, and the UAE is the third largest crypto market in all MENA regions. Report Courtesy of blockchain analytics firm Chainalysis.
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